COMPANY NEWS; ASHLAND TO DISTRIBUTE ARCH COAL SHARES AS DIVIDENDS

Ashland Inc. said yesterday that its board would recommend the distribution of about 17.4 million Arch Coal Inc. shares to Ashland stockholders in the form of a taxable dividend. The proposed distribution represents about 78 percent of the Arch Coal stake that Ashland holds. The company said it planned to dispose of the remaining 22 percent in a tax-efficient manner, based on market conditions. Ashland owns about 58 percent of the St. Louis-based Arch Coal, the nation's second-largest coal company. Ashland's shares fell $1.4375, to $29.0625, and Arch was unchanged at $8.50. Separately, Arch said it would cut its quarterly dividend in half, to 5.75 cents a share.